State rescinds reservoir permit waiver

North Carolina’s environment agency, challenged in court, has quietly erased its waiver of a state permit for a controversial water-supply reservoir in Cleveland County.

In an unprecedented move last year, the N.C. Department of Environment and Natural Resources waived a state permit to certify that a dam across the First Broad River wouldn’t hurt water quality.

The waiver meant the project could seek federal approval without state-level public hearings, despite vocal opposition, or environmental studies.

Now DENR has reversed course.

The advocacy group American Rivers challenged the waiver in a state administrative court.

DENR lost a move to dismiss the case. The department notified Cleveland County Water, the politically connected reservoir’s backer, in January that it had rescinded the waiver.

The reversal is similar to the lawsuits DENR filed against Duke Energy over coal ash contamination last year after environmentalists warned they would sue, said D.J. Gerken, a lawyer for the Southern Environmental Law Center. The center represents advocacy groups on both issues.

In both cases, he said, the department changed its approach when pressed by environmental advocates.

“They abandoned their position when it looked like they would lose,” but before officials could be deposed under oath, Gerken said.

“I personally would have been very curious to hear what any depositions would have brought out,” said Ron McCollum, a Cleveland County Water customer who has fought the reservoir for years. “If it moves forward, I hope we will have the kind of public comment that was denied by the waiver.”

Sarah Young, a spokeswoman for the state water resources division, said the state decided not to fight the law center’s challenge once the judge refused to dismiss it.

DENR has said it waived the state permit because the project faced opposition from federal agencies. The department has said it would have been a waste of taxpayers’ money to air those differences twice.

Rescinding the waiver, Young said, “was just really based on trying not to waste state resources, because it would have gone against the same reason we waived it in the first place.”

It’s hard for reservoirs to win regulators’ approval because they drown streams, wetlands and rare species.

But North Carolina legislators had ordered state regulators in 2011 to collaborate with communities in building reservoirs.

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Rep. Tim Moore, R-Cleveland, served as the attorney for Cleveland County Water. Moore and former Rep. Mitch Gillespie, now the state’s assistant environment secretary, were sponsors of the legislation.

Clyde “Butch” Smith, the Cleveland County Water manager, serves on the state Environmental Management Commission.

The U.S. Corps of Engineers, which would also have to approve the reservoir, and the Environmental Protection Agency say better options exist than damming the First Broad. Cleveland County could expand its current water intake or buy water from neighboring systems, they said.

As it is proposed, the Corps says, the reservoir would cover 1,500 acres of forest and farmland, destroy 24 miles of streams, and six acres of wetlands and endangered plants.

Smith, the water district’s manager, said Cleveland County Water will press on with the project despite the permit waiver.

“We’ll resubmit” the state application, he said. Smith said the water district is waiting on a draft environmental study, which he expects to be completed in 2015.

The water district, which serves 58,000 people, says a severe 2002 drought illustrated its dire need for a new water supply. The district has spent $1.7 million pursuing regulators’ approval for a reservoir Smith has estimated would cost $80 million to $100 million.

“We’ll challenge the Corps in court if we have to,” Smith said. “Our whole point is, we’re trying to get water.”

The law center says DENR couldn’t legally waive the state permit unless the application is complete. Prior to the waiver last July, state officials had told Cleveland County Water it had submitted incomplete information.

After rescinding the permit waiver, the environment department again wrote the water district last month to say DENR “does not have all the information necessary to make a decision” on the application.

“The only thing that happened as a result of the waiver is that it meant they didn’t have to meet state standards,” Gerken said.

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